Governor Gretchen Whitmer proposed an $88.1 billion budget Wednesday, officially launching Michigan's budget season as lawmakers face a challenging 1.8 billion dollar funding gap.
- Governor Whitmer proposed an $88.1 billion Michigan budget to address a $1.8 billion funding gap through new taxes on digital advertising, tobacco, vapes, and online gaming.
- Republican Speaker Matt Hall rejected all proposed tax increases, saying the state should live within its means to keep things affordable.
- Lawmakers have under 150 days to finalize a budget by July 1, with even Democratic legislators expressing concerns about the challenging negotiations ahead
State Budget Director Jenn Flood said the budget focuses on saving neighbors money, ensuring childhood success, protecting health care, creating jobs and keeping communities safe.
"The budget recommendations we present today makes use of every dollar we have," Flood said.
WATCH: WHITMER BUDGET PROPOSAL INCLUDES NEW TAXES TO CLOSE FUNDING GAPS
The budget addresses a $1.8 billion gap Whitmer attributes to federal impacts to medicaid from the One Big Beautiful Bill and declining revenue. Her plan to close that gap includes new taxes on digital advertising, tobacco and vapes, online gaming, and increased recreation fees.
Republican Speaker of the House Matt Hall rejected the tax proposals outright.
"We are not going to do any of that. There will be no tax increases in this budget when we do this deal," Hall said.
Hall said the state should live within its means to keep things affordable for residents.
Whitmer also proposes using $400 million from the state's rainy-day fund to help cover budget gaps, a move that has raised concerns even among Democratic lawmakers.
Democratic Senator Sarah Anthony said the budget presents significant challenges.
"I think we have a lot of work to do to find the right balance but ultimately this is going to be a very difficult budget year," Anthony said.
Lawmakers now have under 150 days to finalize a budget by the July 1 deadline.
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